Editor’s Note: The Elephant in the room, at the core of our topic of procurement is RISK, which is underpinned by fear. But the more I reflect, discuss and consider with the contributors and others, I am convinced that as a profession and community we lack the empirical evidence to support the appropriateness and relevance of the procurement models currently in play.
The ABC gave me permission to edit the transcript of ‘Risky Business’. If I have possibly extracted pieces out of context I apologise, but the chosen discussion allows us to reflect on risk, uncertainty, fear and perhaps shows architects how to approach procurement in an open and fearless manner.
For those who would like an architect’s dialogue on risk, you can hear Amanda Levette at the website for the Australian Institute of Architects’ National Conference – http://wp.architecture.com.au/risk/videos-texts/ –
Now, the point about risk is it takes you away from the 100 percenters and asks you as a citizen to make up your mind about how you may want to live with this list of things—vaccinations, climate change, business—and they affect not only you, they affect others, your immediate family. So what you do affects others.
So risk is for you as a citizen to make up your mind how you want to act, not just for yourself but in terms of the community. Do you remember the community? It’s quite a good idea actually.
And so here we are to talk about risk.
We all face risks throughout our lives, every day of our lives. Some small risks, like should we cross against the red light in order to get to the other side quickly? Some larger risks, like should we send our children to a certain school which we’ve heard both good and bad things about? Financial risks, risks in jobs, should we leave one job and take another? Should we marry one partner or not? That’s an enormous risk.
Sometimes we do know something quantitative about the risks, but sometimes we are just influenced by perception, which can be very different. I and almost all Australians are scared of sharks. There’s one death per year on average in Australia due to shark attacks. But I drive quite happily.
There are a thousand deaths a year in Australia due to motor accidents. I should be much more nervous as far as the quantitative evaluation is concerned over driving than over sharks, but my perception often makes me think differently.
There are some risks we know about — motor accidents, shark attacks, burglaries — and there are some we know virtually nothing about because they happen so infrequently — Ebola outbreaks, terrorism attacks. One also has to think about relative risk. It’s sometimes said that car travel is more dangerous than aircraft flight. Does that mean per journey, per mile, per hour? That’s something that one has to think about frequently. What is the relative comparison that one is making?
I once met an astronaut, and his wife, who I didn’t get on at all well with, told me after a while that I didn’t treat him with sufficient respect, I didn’t know what a dangerous job he had. Seven budding astronauts had been killed in the Challenger explosion, and a number of others in the training phase. And I, because I didn’t like her, said, ‘But madam, per passenger mile it must be the safest way of journey.’ She disliked me even more after that comment.
I’d like to end this introduction by saying a few things about some of the recent ideas on medical risks and life expectancy, David Spiegelhalter’s ideas of micromorts and microlives. First micromorts, which is what is the length in which you’d have to undertake some activity in order to have a one in a million chance of an accidental death. You could ride a motorbike for 10 kilometres. That costs a micromort. You could drive a car for 40 kilometres. You can go in an aeroplane for 40,000 kilometres. Each one of those costs one micromort. Giving birth in Sydney, where it’s quite safe, is actually 50 micromorts.
We all think about risk in the negative and we are fearful, and I think much of our concern about risk is dealt with if we could slightly change our perspective and think about resilience and how we build resilience in communities, rather than the fear that risk can corrode in a community when it becomes pervasive.
And I think quite often we live in a community where fear drives our decisions or where those around us would prefer we were in fear, rather than grabbing hold of these opportunities that great moments of change present and use them to build resilient communities, resilient companies, resilient organisations, resilient families.
We are only going to solve the big risk issues if we take a resilience focus, if we engage with people we haven’t yet spoken to that will help us understand the magnitude of the risk and the complexity of the risk, apply the resilience frame, and we will only do that if there are diverse people involved in the conversation.
So I see that in the context of gender. Women must be at the table where decisions are made. Women should be in the parliament, women should be leading companies, they’ve got to be in the debate because we cannot afford with the risks around us and the opportunity for our resilience to waste 50% of our talent.
I think we’ve fallen back because we are frightened of risk, we are scared, we’ve gone back to a lot of silo-based thinking and protecting ourselves and hiding from risk. And I think if we just reached out, if we learned to collaborate, we thought about risk as an opportunity for resilience and resilience building and engaged the full capacity of our communities, risk would be one of the greatest prompts to a brighter future and relieve us of our fear.
This is the most excitingly disruptive, intriguingly subversive time to be alive. We are going through a period of the most rapid change in human history. We have never seen changes of the scale that we are seeing today. In our own lifetimes, in a generation we’ve seen hundreds of millions of people pulled out of poverty, we’ve seen China go from being less than 5% of the global economy to be the world’s largest economy. The old order is changing with a rapidity that we’ve never known before. And threaded through all of that is uncertainty.
Uncertainty is another way of describing risk. We have never had so much uncertainty in our economic, our geopolitical environment. It’s full of uncertainty, and it’s driven of course in large measure by the rapidity of technological change.
All of this is rapidly changing our world. There is so much exciting technology around us, and it is transforming the world in which we live. So that gives us great uncertainty, and people are threatened by that. Big corporate empires are shaken to the core. Banks get worried about what is going to happen with peer-to-peer lending, using online platforms. Great newspaper companies are brought down by the power of the internet, as indeed are television broadcasters and all these other platforms. So there’s enormous change.
Now, how do we cope with that as citizens, as businesses, in my case as politicians? The answer is that we cannot run away from risk or uncertainty, we cannot be afraid of it, we have to embrace volatility, we have to ensure that we are always as agile and flexible as we can.
As Nicholas NassimTaleb said, we have to be anti-fragile, in the sense that we are strengthened by volatility because nimble, agile, able to maintain the maximum optionality at all time, we can take advantage of rapid changes.
Businesspeople, they say, ‘We just want certainty,’ and I always say, ‘Well, you’ve come to the wrong place.’ And they say, ‘What, Canberra?’ And I say, ‘No, planet Earth. Wrong planet, sorry.’ We are living in an inherently uncertain environment. But I think the key is being able to manage that, and that means that we shouldn’t imagine that the way we did things yesterday is the way we should do them tomorrow.
So embracing volatility and flexibility is critically important because that is how you manage risk.
I thought I’d retreat to an area that I’ve been heavily involved in and that is medical and health risk. As Malcolm said, we are in an extraordinary age. There is a mass of medical technology now available to us. There are new medical techniques that are now mainstream; genetics, proteomics, imaging, methods of gaining information in medicine that we wouldn’t have dreamed of even 10 years ago. Those methods and the treatments that follow and the preventative opportunities that provides creates some real challenges.
How do we deal with the understanding we have of the risk of disease? Do people really want to know about their risk of disease? What about the risks of acting on the basis of the risk of disease? Preventative strategies. What about the risks of vaccination, immunisation? What about the risks related to the new drugs that we are introducing? How do we make those risks? How much do we let people in the general public, individual people make decisions about risk? How paternalistic should the medical and health professions be?
I’d be interested to see a show of hands from those of you who have seen the media coverage of Angelina Jolie’s decision to have her ovaries removed because of her risk of ovarian cancer. Just about everyone. A massive amount of media publicity about this issue, which is an important issue, but perhaps you wouldn’t have come across before.
The reason Angelina Jolie was able to make that decision was because she was able to have a blood test because of her family history, a blood test for two genes, BRCA1 and BRCA2, which predispose to breast and ovarian cancer.
She was found to have a mutation, an abnormality of that gene which leads to up to an 80% risk of breast cancer and up to about a 45% risk of ovarian cancer. She had a bilateral mastectomy I think about two years ago and she more recently made a decision to also have her ovaries out to deal with that risk.
Dealing with that sort of information is massively challenging.
She would have had to have made decisions about what to do in terms of managing without the hormones that her ovaries produce. Is there a risk to her of cardiovascular disease? Is there a risk to her of bone disease? Can that risk be mitigated by taking hormone replacement therapy? And what are the risks to her of taking hormone replacement therapy, given that she was at risk of breast cancer? Were there alternatives to having surgery to have her ovaries removed? There are screening tests that one could use. What is the likelihood of those screening tests being effective? What are the risks of those screening tests? There were false positive rates of the screening tests. Were there any drugs she could have taken and what are the risks of those drugs? There are masses of issues.
So I think there are fantastic opportunities in medicine and health related to all of this new information that we have, but it creates some fascinating and challenging decision-making processes that face individual people and the medical and health professions.
Continuing what Sam said so nicely about fear, and resilience, the opposite of that. I was the chair of a working group preparing a report on terrorism, or how to use science against terrorism. One of the things we highlighted in the report was the greatest fear of terrorism was fear itself. And we were nervous, the first publication of our report, that we felt that the President of the United States, who is meant to calm down the country, was actually building up fear and making them more fearful of terrorism.
I think I’d just say couple of things about fear. Fear is a very big emotion. Human beings are not entirely rational. I think it is absolutely critical, it’s a critical responsibility of governments not to promote fear, and in fact particularly in the face of terrorism, which is a real threat, we are not kidding ourselves about that, but we’ve got to recognise that what the terrorist wants to do, the terrorist wants to frighten us. So fear is the outcome the terrorist wants. Terrorism is the propaganda of the deed. They want to frighten us and make us go about our lives in a very different way. So it’s very important to be strong, to be united and not to be frightened.